Faraday Future agrees to huge bond, escrow account to guarantee Apex infrastructure

Faraday Future, the electric car startup moving to North Las Vegas, has agreed to acquire a $75 million bond and to fund a $13 million escrow account to guarantee the infrastructure needed for Apex to be a viable site for its billion-dollar facility, thus reducing the state's overall liability for the project.

In a letter to the state dated Wednesday that I have obtained, Faraday agrees to post the bond to ensure that "water, wastewater and rail infrastructure" costs are covered, a security that will be released after the company has built 1.6 million square feet on the site and "has generated sales revenue related to electric vehicles at the facility."

The company, according to the letter I have posted below, also has agreed to open an escrow account to help fund engineering plans and perhaps initial plant building. That account must have $13 million by May, the letter says.

The move, requested by the state's economic development folks and allowed under the special session law passed last year (See Sec. 29 on "adequate security"), is designed to alleviate any concerns about the startup's financial wherewithal, most notably and loudly raised by Treasurer Dan Schwartz.

Gov. Brian Sandoval responded to Faraday on Thursday -- that letter also is below -- and wrote the bond "provides full security for Nevada...." The governor also said, "The speed at which you are moving forward with your operation is a clear sign of the seriousness of your investment in our state and this facility."

2016 02 03 Steve Hill FF Letter_v3 by Jon Ralston

20160303090007736 by Jon Ralston